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February 4, 2006

Victoria Strauss -- Author-Agent Contracts

"Victoria, thanks for sharing this info about termination clauses. Can you tell us what other things should be covered by an author-agent contract?"

From an author's perspective (agents may feel differently), here's what I'd want to see covered.

The scope of representation. What's being represented. Contracts can be for a single project, all the author's works, or for whatever works the author and agent agree on (that would be my choice.)

The duration of the contract. Some agents use time-limited contracts--a year, for instance, renewable either by mutual agreement or automatically unless the author or the agent decides to terminate. Others use open-ended contracts--you're represented until you or the agent say otherwise. The latter is my preference. It's easier--no worrying about renewal--and it's more in keeping with the long-term relationship you'll hopefully be establishing with your agent.

As I mentioned in a previous post, be wary if the contract is for six months or less.

Commissions. Commission percentages should be clearly spelled out, including split commissions and the use of co-agents (agents often use co- or sub-agents to sell in markets where they don't have contacts or expertise--foreign countries, Hollywood. The agencies split the commission, with the commmission being higher to ensure that each agency is adequately compensated). Standard commission percentages are 15% for domestic sales and any other sales the agent makes directly, and 20-25% for co-agented sales. (There are some exceptions. A handful of successful agents charge 20% domestic to newcomers, and some agents want 30% for co-agented sales. This isn't the norm, however.)

Note that the higher commission should be charged only when a co-agent is used. Where the agent direct-sells to overseas or dramatic markets--as larger agencies are increasingly doing--the commission should still be 15%. Many inexpert agents want to charge 20% across the board for any and all foreign or dramatic sales. Of course that's a moot point, since an inexpert agent is unlikely to sell your foreign rights. Still, something to watch for.

Beware of agents who only charge a 10% or 12% commission on book manuscripts. I think there may be one established agency that still does this, but in most if not all cases a low commission is an inexpert or fraudulent agent's ploy to try and hook you with a "bargain" rate so you'll feel better about paying an upfront fee.

Reimbursable expenses. Reputable agents don't charge upfront fees, retainers, deposits, etc., etc. You already know that. However, most agents do expect their clients to bear some of the cost of submission--postage, photocopying, Fed Ex, long distance phone calls. These should be clearly defined in the contract, as well as how they'll be reimbursed--ideally, accrued and deducted from your advance; less ideally (and less typically) billed as they're incurred. It's also a good idea to have a cap for any single expense (say, $50) beyond which your permission must be sought.

(A cap on a single expense isn't the same as a general expense cap, where the agent tells you he'll spend no more than $75 per month or $500 per year. Where you see wording like this, beware: the agent may use it like a blank check.)

How money will be collected and disbursed. The publisher pays your agent; your agent deducts her commission and any expenses and forwards the balance to you. (This arrangement is formalized in the "agent of record" clause of a publishing contract.) The procedure for this should be clearly stated. Ideally, it should conform to the AAR's Canon of Ethics--authors' money should be deposited in a separate account, and payment should be disbursed no more than 10 days after the publisher's check clears. Some agents just say they'll disburse "promptly" or use a different time period such as two weeks--that's OK too, as long as you're sure they're reputable.

Speaking of the agent of record clause, here's something to watch out for: the so-called "perpetual representation clause" in a publishing or author-agent contract, whereby the agent designates himself "the sole and exclusive agent with respect to the work for the life of the copyright." Your agent should be the agent of record for the life of the publishing contract only.

A termination clause. Whether your contract is time-limited or open-ended, you (or the agent) should be able to terminate it at any time, for any reason, with adequate notice. NEVER sign a contract without a termination clause, and be wary of contracts that place limitations on your ability to terminate--for instance, an excessive notice period (90 days or more), or a demand that you show cause.

What happens after termination. After you sever a contract, an agent will continue to collect commissions on any contracts she brokered for you. She'll also usually claim a commission on any deals that were in progress at the time of termination, even if the deal is concluded after you've parted ways, and also, often, on any deals that result from contacts she made for you, even if those deals post-date termination. All of this should be spelled out.

Beware of unreasonable demands: claiming commission on "successor" works--for instance, a sequel to a book your old agent sold--even if the agent has nothing to do with the sale of that work; claiming commission on anything you sell for a period of years after termination, even if it's sold through a new agent; claiming commission on any deal you make with a publisher the agent contacted, even if it's for a different manuscript. These are all terms from actual author-agent contracts that I've seen.

What happens on the agent's death, disability, or bankruptcy. How will your work be represented and your royalties paid if the agent dies or liquidates his business? Ideally, you should be able to terminate your contract at once, and instruct publishers to pay your royalties directly to you.

Other things. Language stating that all contracts or licenses are subject to your approval; a non-assignment clause stating that the rights under the author-agent contract can't be assigned without your approval; language binding the agent to provide at least an annual accounting, with a Form 1099.

That's it. Oh, and to keep my favorite Law Shark happy: since I'm not a lawyer, the above shouldn't be construed as legal advice, but as commentary based on experience and research.

I have a few questions for you... What does an author do if she terminates the contract with her agent thirty days prior, as written in the contract, due to neglectful responses of e-mails, and finds out through the agent that three of her ms's are still out at three publishers for review, yet the agent is closing the business due to the head owner having a tare in her eye retnea that can't be repaired, and still on top of all this, lets each author go upon the their ending date-of-contract. Also, the agent does not get back to the author during the final days of the contract after several e-mails as to any news from the three publishers? Do I contact the three publishers? Or, do I have my new agent do this and be the agent of record on any sale made after the ending date of contract since it was terminated? Is this legal or if they sued for their commission would I loose? I don't know if they would sue me directly or the new agent, which worries me.

Also, I have found an agency in New York that charges only 10% commission based on sale only and has been around for over ten years. They've asked for me to get a third party critique to make certain the ms's are ready to go for them to market and pitch. They do not ask for this money and have no upfront fees. I just received a positive review and they have made it perfectly clear they are not in any way shape or form involved with vanity publishers nor do they pitch to vanity publishers. The New York Literary Agency is their name. I wonder if you've ever heard of them? I would like to go with them but need someone else's imput.

If you've terminated your agent contract per the contract's instructions, you are free and clear once the 30-day notice period has expired. As for the mauscripts that are still sitting with publishers--since the agency is closing, I think it would be OK for you to contact the publishers directly. Write a brief email saying that you're no longer with your former agent, and are following up on your own.

Also, check your contract to see what kinds of rights the agent retains after the contract terminates. As I noted, most agents do claim commission on any sales that result from submissions they made, even if the sale is completed (by you or another agent) after termination. This may be a moot point because the agency is closing, but it never hurts to be sure.

I hope you'll forgive me when I say that I wonder if your agent is blowing smoke up your fundament. Health problems are a frequent excuse for bad agenting (see Ann's "I Can't Sell Your Book Because..." post). I also suggest this because you've asked about NY Literary Agency, and writers who get mixed up with a questionable agency often are coming from or move on to another.

New York Literary Agency charges critique and editing fees (the "sister" company they recommend for the critique/edit is actually under common ownership). It's a newish branch of an agency that has been in business as a fee-charger since 2001, and in that time, to Writer Beware's knowledge, has never sold a book to a commercial publisher. There's much more at this thread on the Absolute Write message board.

I read the questions to Victoria concerning New York Literary Agency. I read about them on Preditors and Editors, just in the nick of time. I don't think they turn down any manuscripts. Lousiana writer.

JABberwocky is a successful agency specializing in genre fiction, with a solid track record of sales (and a good demonstration, by the way, of the fact that established agents sometimes have horrid websites). In other words, there's no comparison between them and NY Literary.

Hello. I can't find any information on the following: Is it unethical to look for a new agent before leaving the current agent? What are common mistakes people make that lessen their chances of getting a new agent? What does a writer looking for a new agent need to know? Thanks for ANY advice!

"PE will receive commissions upon sale of the author's work even if the contract has already been terminated, provided that the sale was due to the agent's efforts during the term of the contract."

This the clause that my agent now wishes to add to our contract. I have refused to sign and they have threatened to call back all my manuscripts from publishing. When they refer to the agent's efforts, they mean, I suspect, that I won't be able to publish with any of the editors they have contacted thus far without their getting a cut. This would make it almost impossible for me to find a new agent. If we terminate, I want to start with a clean slate. They can say how much they've done for me by placing my manuscripts with a dozen or so publishers. They've actually done very little, jeopardizing my chances by writing careless cover letters and by keeping me from marketing my work for almost three years. My question is 1. Is the quoted clause too vague and does it give them too much power over my work? 2. What do you think of the threat? i.e. either you sign or we stop working? 3. How can I be sure that they will give me a true and verifiable account of mailing expenses up to this point?

"PE will receive commissions upon sale of the author's work even if the contract has already been terminated, provided that the sale was due to the agent's efforts during the term of the contract."

This the clause that my agency now insists upon adding to our contract, signed nearly two years ago. I refuse to sign When they refer to the "agent's efforts," they mean, I suspect, that I won't be able to publish with any of the editors they have contacted without their getting a cut. In perpetuity. This would make it almost impossible for me to find a new agent. If we terminate, I want to start with a clean slate. They can say how much they've done for me by placing my manuscripts with a dozen or so publishers. They've actually done very little, jeopardizing my chances by writing careless cover letters and by keeping me from marketing my work for almost three years. Please tell me what you think of their new clause and why they are so adamant that I sign it?

My agent has held my proposal for 3 months, always asking for more pages, never rewrites. She sent me a tentative list of pubs but did not send the proposal out to anyone. I am now ninth on her "list" and want to cancel my at-will contract. Her one sentence ends "or concluded within six months following the written termination..." Is it a realistic worry to think she could submit the proposal during those six months? Thanks so much for this web site. Carol

Carol, with the proviso that I haven't seen the contract or the full clause you're citing just one sentence of, my guess would be that the sentence you've quoted is intended to cover the possibility of an offer from a contact or submission she made for you prior to you terminating the contract, even if that offer happens post-termination. Since she did the work, she feels she's entitled to a commission, even though she's no longer your agent. This is standard in author-agent contracts.

Once the contract is terminated (and usually there's a 30- or 60-day window), she should no longer be able to submit your work. Just to be sure, though--in your termination letter or email, you might ask her to immediately cease all efforts on your behalf.

Obviously I don't know your situation, but busy agents can take time getting something ready for submission. Might you consider giving it a bit longer--or discussing your concerns with her to see if you can clear the air?

Ms. Strauss, an agent wants me to sign a contract in which he gets full commission on any sale made to a publisher he "contacted" within 12 months of termination of our agreement. That seems way too long, and anyway, what does "contacted" mean? Isn't that too broad, should he be defining that?

Fran, it's standard for an agent to claim commission on sales that result from submissions or contacts (meaning anything from an actual submission to conversations/pitches with editors) he made for you, even if those sales post-date contract termination. Since he did the work of putting you and the editor together, he figures that he's entitled to compensation.

I do agree that 12 months is long (although not entirely unreasonable, given the lengthy response timeframes in publishing). 6 months would be better. This is something you may be able to negotiate.

I have my novel in the hands of a well researched agent. Her history and track record seem impressive. Her website though, confuses me. She says that book publishers are 'expecting' literary agents to include an author's marketing platform or plan with their submission. Isn't this the agent's responsibility? Isn't this supposed to be why we pay them a commission? Or am I wrong or just misinformed? She also has a segment on 'return of advance'. She gives a list of reasons why this would happen, but they too confuse me. Why would a publisher offer an advance just to cancel the contract and demand repayment of the advance? Wouldn't they first make sure that the novel, or whatever, is marketable before even offering said advance? Another question is about marketing. She has that we should "Create a buzz/excitement about your book before it's published." And, "Customize your marketing plan for your book." And lastly, "You must get known to be found by book buyers." Wait a minute...Do I have to find my own book buyer? These would all seem to be responsibilities of the agent. Or again, am I mistaken.

She has mentioned in her site that one reason for all these new responsibilities upon said author, is because publishers have noticed the success of the self-published. This seems to be contradictory to your business. If the success of the self-publisher is so good, then why do I need an agent?? I am very confused.

Thanks for this very informative post. I am in the process of considering an agent contract and am curious what you think about this particular paragraph in the termination clause:

Agent shall also be entitled to the above-mentioned commission on anysubstitutions, renewals or new agreements negotiated by Agent or by Cient’s newrepresentation which replace any contract entered into for the Work(s) during the termof this agreement, and for the sale of subsidiary rights to Client's Work(s) in any unsold markets, i.e. foreign, motion picture, television, audio, e-book, ancillary rights , book-related merchandizing rights, etc., for a period of two (2) years from the date of first publication of the Work.

It's kind of an odd provision--under normal circumstances and with a stable publisher, you wouldn't expect a contract to be replaced within two years of publication. Odd, too, that it appears in the termination clause rather than in whatever clause covers commissions, which is where you'd expect to see all commission language. However, I'm reluctant to comment without seeing the entire agreement; there may be language in it that bears on this clause. Feel free to send it to me at beware [at] sfwa.org . All information and material shared with Writer Beware is held in confidence.